Homeowners in the northeast are increasingly attracted to solar power because it offers relief from high utility rates. In Connecticut, for example, electricity prices are approximately 18¢ per kW hour, tied with New York for the second most expensive in the country behind Hawaii. (For more information see our earlier post Solar Economics 101). Fortunately for Connecticut homeowners, state rebates and other incentive programs are available to support an investment in solar energy. But the picture varies tremendously from state to state when it comes to two big economic factors in making an investment in solar: utility rates and state renewable energy policies.
To illustrate how different the situation can look depending upon your geography, we talked to Ben Southworth, a designer and builder of high performance, energy efficient homes in Lancaster, New Hampshire. Ben is intimately familiar with renewable energy resources ever since Ben’s father purchased a hydro-powered sawmill back in 1974. (Of note, Garland Mill is still in operation and produces more energy than the Southworth family business uses on an annual basis.) Today, Ben and his family business, Garland Mill Timberframes, often utilize solar in home design to keep with their mission of providing craftsmanship and materials along with state-of-the-art building methods. Garland Mill Timberframes and their customers can face challenges when applying solar in a state like New Hampshire, a state with solar policies and incentives that are not as robust as other states in New England like Massachusetts or Connecticut. Ben graciously shared his thoughts with us on designing energy efficient homes and what it is like to be a solar system owner in New Hampshire.
Q: Tell us about yourself
When I got involved with the family business, I was attracted to design. I was interested in designing and building really thoughtful, responsible buildings. Good design is about creating synergies but also delight. Is this a peaceful space? Is this a space that makes me feel at home? When I started to learn more about how much energy buildings use, and how much that energy use contributes to climate change, it made me rethink my approach to peaceful, delightful spaces. I’ve spent the past 10 years trying to sort out how we can build beautiful buildings that are also elegant from a mechanical and energy use standpoint.
Q: How did you become involved in solar?
Using solar panels allows us to have control over how much carbon our buildings are emitting. Energy use is invisible to all of us; it’s very hard to be mindful of it. Using PV [solar photovoltaic panels] changes all of that. I’m not a PV evangelist at all. I want to race to the bottom to use less energy than we produce. At the moment, for individual homeowners, PV, in conjunction with rigorous home performance upgrades, is the best way to do this.
Ten years ago, only the very fringe of society had the money or the desire to reduce energy use in their homes and generate clean energy. Now, through lower cost PV and new financing mechanisms, many more people have the ability to do that. I’m just so grateful that we are getting to the point where people can finance PV; that we can make PV available in the same way that cars are available to everybody. Very few people in the US cannot afford to buy a car. Most people, one way or another, can get their hands on a fossil-fuel-driven vehicle, mostly through financing. For us to bring PV to scale, we need this financing mechanism. I think if we’re able to continue this trajectory, then buying PV will become just like buying a car.
Q: Do you own solar? Why did you choose to own?
I had some friends from Massachusetts recommend that I lease, but leasing wasn’t available in New Hampshire. For me, installing solar was an easy choice. I could send money to the utility, or I could send loan payments to SunPower, the manufacturer who put the panels on my roof.
Q: Do you believe solar ownership is important?
Big picture for me is this notion of distributed generation, and PV offers the most cost effective way to create distributed generation. I’m really excited about every house being a power plant. This builds resilience and a sense of responsibility. We are responsible for the energy we use. Solar provides a way to produce clean power that reduces our reliance on large, centralized, inefficient, and dirty generation plants.
Q: Do you think solar can be a smart investment for a homeowner?
Solar is a very safe investment. There’s not a lot of downside potential. But it depends upon where you live. Here in New Hampshire, you’re not going to make the huge numbers like you can in a state like Massachusetts. But you can get a pretty respectable return in a responsible investment; 5-7% is a pretty reasonable return on investment. When you think about solar as an investment, you need to consider how much you are paying for grid power, what the interest rate is on your loan, and what the future cost of power may be. We don’t know how expensive power will be in the future. With “clean” gas generation power, costs could drop dramatically which could impact your return on investment. My wife’s family is from Texas. No one is bending over backwards to do anything for solar in Texas because the cost of electricity is so low. They’re paying somewhere around $.11/kW hour. Up here in New Hampshire, it’s twice as expensive. But I didn’t put PV and solar hot water on my roof because I wanted to make a lot of money. Is it the right thing to do? Yes. It is responsible? Sure. I only have an $11 utility bill because of the connection charge. Without solar, I would be paying $80-$100 to the utility. Instead I’m paying this amount and a bit more to SunPower to pay off my panels.
It is the ability to send money somewhere that is a good, responsible, long-term investment. I wish I had more responsible, low-risk opportunities to invest.